Print Edition - 2015-07-15 | MONEY
Most demands addressed: Pvt sector
Jul 14, 2015-
In what could be termed as a business-friendly budget, the government has incorporated many suggestions of the private sector.
Presenting his eight budget, Finance Minister Ram Sharan Mahat has addressed many demands of the business fraternity—from revising the Value Added Tax (VAT) threshold to special facilities to cement industries and amendment of the Act to allow Nepalis to invest abroad.
The budget for the next fiscal year has revised the VAT threshold, which means business transaction of up to Rs5 million will be exempted from VAT from next fiscal year. The current ceiling is Rs2 million.
The private sector had long been demanding the government hike the VAT threshold.
Pashupati Murarka, president of the Federation of Nepalese Chambers of Commerce and Industry, welcomed the government’s move.
At the time when the cement industry has been attracting investors’ interest, the budget has said the government would construct access roads for cement plants and facilitate electricity. Under the plan, road connecting 16 cement factories with their mines, while electricity sub-centres and transmission lines at 12 cement factories would be constructed. The government has allocated Rs630 million for the purpose.
Factories that produce up to 3,000 tonnes of cement by extracting 4,800 tonnes of limestone can operate only after conducting preliminary environmental assessment. The budget says similar modules of constructing needy infrastructure will also be initiated for iron extracting mines of Ramechhap. “The provision of building access road and arranging power supply for cement industries is a welcome move,” said Bhawani Rana, senior vice-president of FNCCI.
The budget has said the government would initiate timely amendment to the Act on foreign investment and technology transfer.
Addressing the real estate sector’s demand, the government would allow foreigners to purchase property in the country. The budget has also planned “Investment Conference”. Investment in big infrastructure and other potential sectors would be promoted under public-private participation.
The budget has stated the contribution made by the private sector to the Prime Minister Relief Fund can be deducted from their income. Golchha Organisation Executive Director Shekhar Golchha said the move would offer some relief to businessmen. “However, our concern is the government has talked about introducing the Social Security Act, but has not spoken about the Labour Act. Our stance is both the Acts should be introduced simultaneously,” he said.
Along with revising the VAT ceiling, the budget has also talked about revising the tax provision and simplifying customs procedures.
The government would simplify the procedure by implementing integrated paperless tax system, which is expected to reduce the cost of tax collection.
Declaration of imported goods and their valuation will be done online. The government plans to carry out timely reforms in the customs controlling system to simplify trade.
The government would strictly implement the provision to use the domestic products by state-owned bodies.
Published: 15-07-2015 08:24